In this paper, we explore the optical properties of Ag nanoparticles chemically modified with alkanethiol self-assembled monolayers (SAMs) by measuring the localized surface plasmon resonance (LSPR) spectrum using UV-vis extinction spectroscopy. For all the experiments presented here, the Ag nanoparticles were fabricated using the technique of nanosphere lithography (NSL) and had in-plane widths of 100 nm and out-of-plane heights of 50 nm. We first demonstrate that unmodified nanoparticles are extremely susceptible to slight changes in 3-dimensional structure when exposed to various solvents. These structural effects can have dramatic effects on the extinction maximum, lambda (max), of the LSPR shifting it to the blue by over 100 nmr The significant discovery reported here is that lambda (max) for NSL fabricated Ag nanoparticles is extremely sensitive to the SAM properties. We will demonstrate the following new features: (1) lambda (max) of the LSPR linearly shifts to. the red 3 nm for every carbon atom in the alkane chain; (2) spectral shifts as large as 40 nm are caused by only 60 000 alkanethiol molecules per nanoparticle, which corresponds to only 100 zmol of adsorbate; and (3) the nanoparticles' sensitivity to bulk external environment is only attenuated by 20% when the nanoparticles are modified with the longest chain alkanethiol (1-hexadecanethiol, similar to2 nm). Experimental extinction spectra were modeled by using Mie theory for Ag nanospheres with dielectric shells intended to mimic the self-assembled monolayer (SAM) in thickness and refractive index. We find that the Mie theory qualitatively predicts the experimentally observed trend that lambda (max) linearly shifts to the red with respect to shell thickness, pr alkanethiol chain length; however, the theory underestimates the sensitivity by approximately a factor of 4. Excellent correlation between theory and experiment was observed when Mie theory was,used to predict the degree of attenuation in LSPR sensitivity to bulk external environment when the nanoparticle is encapsulated in a dielectric shell similar to an alkanethiol SAM. Finally, we demonstrate that Ag nanoparticles modified with functionalized SAMs can be used in sensing applications. Here, we show that the LSPR shifts to the red 5 nm with the adsorption of the polypeptide poly-L-lysine (PL) to Ag nanoparticles modified with deprotonated carboxylate groups from 11-mercaptoundecanoic acid (11-MUA). Furthermore, we will show that this system behaves reversibly and exhibits no detectable nonspecific binding.